The ski area business model

A Reddit follower has been shocked, truly shocked, to find out that the overall sticker price for his emergency appendectomy was over $55,000, and that his (presumably) bargain-basement health insurance left him with a tab of about $11,000. He says he never before realised how much health care in the US of A cost. No doubt it didn't help to hear, from the provider and other sources, that his piece of the action is negotiable and that hardly anyone pays full price. This is why ski area lift tickets cost so much: the sticker price paid by the innocent minority has to bear the cost of the discounts given to the well-informed minority. Our hero was essentially invited to dicker instead of posting his original bill on Reddit, and of course he didn't know he could do this until after the hospital sent the bill.

This is the reality of my working life. In fact, before the holidays I was working something similar. Except that the payer was a client who was shocked that a spine procedure came with a sticker price in the same price range as that Reddit naif's appendectomy. After all, the client said, didn't we just negotiate a much lower price with the surgeon?

We did. But if you need a medical procedure and you settle up with the physician or surgeon, or with the hospital, you're no more than halfway there. In the land of the free the hospital and the physician bill, and get paid, separately, with very few exceptions. I fear that startled Redditor is in for another shock when he gets the surgeon's bill.

Now, consider how all this plays out for the chronic pain sufferer. It's no longer about one emergency procedure. It can often be about a lifetime of physician visits, punctuated by elective surgery procedures. This is the sort of person that pre-ACA insurers did not want to cover. The only benefit is that if you deal with chronic pain, your naivete goes out the window fast. You're obliged to become actively involved in your treatment, studying what ails you and querying your clinicians at every step. Instead of being shocked by an invoice, you anticipate the grand larceny that is American healthcare, work out in advance what you can pay, and shop around for the best deal.

Is all this necessary? No. Especially it should not be necessary for patients who may be spending much of their lives distracted by pain. Will the ACA fix it? Not entirely, because what we've done so far is only a tentative step toward a system that removes all the incentives for charges that are completely out of line with actual costs.

In the meantime, one can only hope that more people get the outrage.